1408 Cottage Dr

Houma, LA 70360

$274,000D

5 bd · 2.5 ba · 3,000 sqft · Built 1979 · SingleFamily · Active · 14 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,970/mo
• Mortgage (P&I): −$1,437
• Tax + insurance: −$343
• HOA: −$0
• Vac / Maint / Mgmt: −$414
• Net cashflow: $-223/mo
• Annual: $-2,682/yr
• Cap rate: 5.61%
• Cash-on-cash: -2.46%
• DSCR: 0.89
• 1% rule: 0.72%
• Cash to close: $76,720

Investor read

• This is a 5-bed/2.5-bath single-family listed at $274k.
• At list price, monthly cash flow is $-223 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $235k (14.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $197k (28.1% below list).
• Only 14 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $197k (28.1% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 64/100 on livability (#165 in LA) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A; Watch: employment D, crime D-, amenities F.
• Terrebonne Parish (other): math 32% / reading 46% proficiency, ranked #23 of 98 in LA (top 24%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 62% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: flood insurance adds $66/mo.
• Market conditions: Rents rising (+2.8%/yr); 356 active listings in the ZIP; solid renter incomes; 300 units permitted in Terrebonne Parish in 2024 (0 in 5+ unit buildings).
• 14 sale attempts since 5y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $130k; list at $274k implies a 111% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe flood risk; severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.6% vs local median 4.0% in Houma — top-decile yield for the area; either an underpriced asset or a hidden risk that comps aren't pricing in. Stress-test before assuming the spread holds.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• Built in 1979 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• Crime grade is D in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• What's the average days-on-market for RENTAL listings here right now (not sales)? A rising rental-DOM trend means longer vacancies and softer asking-rent achievability than the comps imply.